Lohit Gogoi vs. The State Of Assam And 2 Ors.

Facts

The petitioner, Lohit Gogoi, challenged the actions of the Assistant Commissioner of State Tax, Dibrugarh. The petitioner contended that the Assistant Commissioner issued a summary of show cause notice dated 15.12.2023 without issuing a proper show cause notice under Section 73(1) of the CGST Act, 2017. Furthermore, a summary of order dated 26.04.2024 was issued without passing a formal order under Section 73(9) of the CGST Act, 2017. The petitioner also alleged that an opportunity of hearing was denied before the summary of the order was passed. Both parties agreed that the issue was identical to a previous case, Construction Catalysers Pvt. Ltd. Vs. the State of Assam and 2 others, decided by a Coordinate Bench.

Held

The Court held that the Summary of Show Cause Notice (GST DRC-01) is not a substitute for the Show Cause Notice required under Section 73(1) of the CGST Act and the State Act. The Proper Officer must issue a Show Cause Notice to initiate proceedings under Section 73. Similarly, a Statement of determination of tax under Section 73(3) cannot substitute for the Show Cause Notice under Section 73(1). Proceedings initiated under Section 73 without a proper Show Cause Notice are bad in law. The issuance of summaries does not dispense with the statutory requirements of issuing a proper Show Cause Notice, Statement, and passing an Order by the Proper Officer. The Court also found that the impugned orders violated Section 75(4) as no opportunity of hearing was provided. Consequently, the impugned orders were set aside and quashed. The Court granted liberty to the respondent authorities to initiate de novo proceedings under Section 73 if deemed fit, and excluded the period from the issuance of the summary show cause notice to the service of the judgment for computing the time limit for passing orders under Section 73(10).

Key Issues

1. Whether the Summary of Show Cause Notice in GST DRC-01 can substitute for a Show Cause Notice required under Section 73(1) of the CGST Act, 2017 and the State Act? 2. Whether a Statement of determination of tax under Section 73(3) can substitute for the Show Cause Notice under Section 73(1)? 3. Whether proceedings initiated under Section 73 without a proper Show Cause Notice are legally valid? 4. Whether the issuance of a Summary of Show Cause Notice, Summary of Statement, and Summary of Order dispenses with the requirement of issuing a proper Show Cause Notice, Statement, and passing of an Order as mandated by Section 73 by the Proper Officer? 5. Whether the impugned orders are in violation of Section 75(4) for failure to provide an opportunity of hearing? Petitioner's arguments: The Assistant Commissioner failed to issue a proper show cause notice under Section 73(1) and a formal order under Section 73(9). The summary of the show cause notice and order were issued without granting an opportunity of hearing. Revenue's arguments: The judgment notes that both learned counsels submitted that a similar issue was dealt with in a previous judgment (Construction Catalysers Pvt. Ltd. Vs. the State of Assam and 2 others), implying agreement on the applicability of that precedent.